Home Business 25% of demand now coming from digital channels, HUL tells investors

25% of demand now coming from digital channels, HUL tells investors

Hindustan Unilever (HUL) said the digital channel now accounts for 25 per cent of demand. It said it reaches 9 million stores digitally and sells 60 billion units, according to an investor presentation that was filed on the stock exchanges.

Last year, demand from digital channels – including e-commerce and its business-to-business app Shikhar, which retailers can use to place orders – stood at 20 per cent, it said.

In financial year 2021-22 (FY22), its turnover stood at Rs 50,336 crore.

HUL said it was witnessing a twofold increase in modern trade and pharma and cosmetics and fourfold growth in e-commerce sales.

In the presentation, HUL said it designed a portfolio to address shoppers’ needs on digital channels. For instance, in the premium beauty business, it launched five digital-first brands.

Besides, it has a diversifying channel play for its direct-to-consumer brand, Simple, on e-commerce platforms Amazon and Nykaa. It has also seen a 230 basis point rise in demand for Simple on Amazon.

In hair care, where it has brands like Sunsilk and Indulekha, HUL has seen the highest share gain in two decades with over 400 basis point rise in three years, which was three times more than its largest competitor.

Premium products now account for 33 per cent of the firm’s portfolio, compared with 22 per cent in FY12.

HUL operates in 15 categories and holds a leadership position in 85 per cent of its business, it said. It added that 16 of its brands had a turnover of over Rs 1,000 crore.

It said eight of its brands – Surf Excel, Horlicks, Lux Brooke Bond, Lakme, Wheel, Lifebuoy and Glow & Lovely – were among India’s most valued brands.

The FMCG major said it was focused on building back its gross margins and also stepping up its advertising and promotion spends.

In its post-results conference call, recently, Unilever Chief Executive Officer Alan Jope told investors that the Indian market was growing in value, but volumes were declining.

However, he said the company was confident of HUL’s ability to grow ahead of the market and gain market share as a result.

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